Hong Kong registered FDI inflows of US$103 billion in 2014, a year-on-year increase of 39%. This puts Hong Kong second only to mainland China (US$129 billion) and ahead of the U.S. (US$92 billion), the U.K. (US$72 billion) and Singapore (US$68 billion).

Welcoming the news, Director-General of Investment Promotion at Invest Hong Kong Simon Galpin said the city’s ranking in global FDI flows is very encouraging, with record amounts of both inflows and outflows.

“The numbers highlight HK’s role as a 'super-connector' and a conduit for direct investment,” he said. “Foreign investors use Hong Kong as a base to then invest in the rest of China and the region. Mainland companies increasingly use Hong Kong as a platform to make global investments and acquisitions."

In terms of outflows, Hong Kong also ranks second (US$143 billion), following the U.S. (US$337 billion) and ahead of mainland China (US$116 billion), Japan (US$114 billion) and Germany (US$112 billion). The report said the increase of outflows from Hong Kong was partly a result of booming cross-border merger and acquisition activity.

Globally, inflows fell by 16% to US$1.23 trillion in 2014, as a result of the fragile global economy, uncertain policy for investors and elevated geopolitical risks.

Looking beyond 2014, the report says that a sustained recovery is in sight, with global inflows projected to grow by 11% to around US$1.4 trillion in 2015, rising to US$1.5 trillion in 2016 and US$1.7 trillion in 2017.